Indonesia Signals Rate Cuts Unlikely in First Half of Next Year
- Key rate held at four-year high of 6% as price risks flare up
- BI in no rush to ease, unlikely to follow Fed rate cut pace
The Bank Indonesia headquarters in Jakarta.
Photographer: Rosa Panggabean/BloombergThis article is for subscribers only.
Bank Indonesia left its benchmark interest rate unchanged to keep inflation under control in the face of surging food costs, while signaling any easing is unlikely to happen before the second half of 2024.
The decision to keep the BI rate — formerly called the seven-day reverse repurchase rate — at a four-year high of 6% was predicted by all 29 economists in a Bloomberg survey. Governor Perry Warjiyo, who late last month hinted that the rate will stay at the current level for some time, said on Thursday that the bank won’t necessarily follow the US Federal Reserve in cutting rates.